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How Maoists manipulate Nepal’s labor unions

West Lafayette, IN, United States, — The Maoist-affiliated All Nepal Free Hotel and Restaurant Workers Union forced 24 outlets of four restaurant chains to close last week. Union workers went on strike demanding a 40 percent pay raise and 100 percent “dearness allowance” increase (similar to cost-of-living increase), along with other demands.

Following negotiations, the closed restaurants will reopen on Wednesday. Shyam Sundarlal Kakshapati, the president of the Restaurant and Bar Association of Nepal who led negotiations with the union leaders, has hinted that there is no possibility of fulfilling the workers’ demands on salary and dearness allowance raise. The four restaurant chains reportedly suffered about 800,000 rupees (nearly US$11,000) in losses per day due to the forced shutdowns.

From the facts, this looks like just another dispute between labor and management, of the kind that is common around the world. But the actors behind the scenes make this labor dispute part of a larger strategy of the Maoists to slowly derail the economy and establish their version of a socialist Nepal.

In their 2008 Constituent Assembly election manifesto, the Maoists declared that they aim to establish “socialism-oriented national industrial capitalism” by promoting the private sector, initiating revolutionary land reforms and encouraging foreign direct investment. The Maoists actions, however, tell a different story.

In late 2008, a Maoist-affiliated trade union attacked Himal Media, the publisher of the Nepali Times and Himal, after the two newspapers published reports criticizing union leader Salikram Jamarkattle for essentially extorting funds from businesses that refused to accept his demands. Jamarkattle is also a Constituent Assembly member and is involved in coordinating the restaurant strike.

The attack on Himal Media prompted widespread condemnation and brought huge media attention to the Maoists and their trade unions’ actions. Unfortunately the disturbances in the restaurants have been virtually ignored by the Nepalese media. The Maoists are getting a free pass, even after causing long-term damage to the country’s already battered economy.

No one disputes the fact that workers should be paid fair wages and have bargaining rights with the management. But demanding a 40 percent pay raise all of a sudden is not the way. It is irresponsible, as it is not possible for a business to make money if it takes such a big hike in overhead without an opportunity to arrange funds to cover the gap.

What benefit is it then to shut down a business, thereby taking away

employment opportunities from so many? That too in a country where unemployment is 46 percent and has grown 4 percent in the last four years.

The only way to explain this contradiction is to see labor rights as a tool for the Maoists to gain greater control over the economy. Maoist-affiliated unions are mushrooming in business establishments across the country. They are run with just one goal in mind — to further the party’s long-term goals.

One by one, the party conducts strikes to test the waters, using unreasonable demands. As businesses are forced to settle to save themselves, the Maoists move ahead with their plan.

The closed restaurants will open on Wednesday, but there is no guarantee that they will be able to operate in a business-friendly environment. What the union has forced the management to concede is not public yet; but it is amply clear who runs the show in Nepal.

During their decade-long armed conflict, guns and weapons were the tools for the Maoists. Now they have unions and Constituent Asembly members.